Ernst and Young (EY) has published a new report, showing that the now-defunct Canadian crypto exchange QuadrigaCX has $22 million in assets, but has $160 million debt.
The report outlines that the company’s assets and debts are distributed between three subsidiaries linked to the exchange, namely Whiteside Capital Corporation, Quadriga Fintech Solutions, and 0984750 B.C. The report showed the assets and liabilities of QuadrigaCX as of April 12, 2019.
The EY staff acting as the monitor and trustee in the case of QuadrigaCX, George Kinsman, underscored on the report that there’s “material discrepancy between the reported fiat and cryptocurrency obligations,” and that careless bookkeeping was an issue the company faced.
The exchange initially filed for creditors protection and subsequently declared bankruptcy in March after getting approval from Nova Scotia Supreme Court Justice Michael Wood. The bankruptcy would enable the company to sell assets, “including but not limited to Quadriga’s operating platform.”
EY failed to locate any cryptocurrency in the exchange’s cold wallets, which had been emptied since April last year. QuadrigaCX also accidentally transferred $500,000 CAD to one of these addresses. EY’s report at the time said that the Canadian platform failed to defend why the wallets had not been utilized for months. Kinsman wrote:
“The applicants have been unable to identify a reason why Quadriga may have stopped using the identified bitcoin cold wallets for deposits in April 2018.”
EY purportedly was able to recover around $500,000 worth of cryptocurrency from the exchange’s hot wallets and “various other sources,” and now stores 61 BTC, 960 ETH, 33 BCH, 851 LTC, and 2,661 BTG.